THE co-owner of The DRG, which describes itself as Scotland’s largest restaurant group, has declared that "many good businesses have not been as fortunate" as the group he heads.

Mario Gizzi, a hospitality industry veteran, warned the position of many restaurants and bars remained particularly precarious after the “rigours” of Covid.

The DRG, which operates the Di Maggio’s, Amarone, Café Andaluz and Anchor Line brands and is based in Glasgow, achieved a surge in profits and turnover as it bounced back from the effect of coronavirus-related restrictions.

Mr Gizzi said: “The hospitality sector has undoubtedly been one of the worst affected by the fallout from Covid, despite the very welcome support we received from the Government.

“Thanks to our robust financial and operational approach, married to the amazing resilience of our colleagues, we managed to emerge from the pandemic and resume serving our customers quickly. However, many good businesses have not been as fortunate and I suspect that we’ve not seen the end of the fallout in the hospitality industry.”

The DRG is eyeing further expansion in England, on the back of an “extremely strong” opening of a Café Andaluz outlet in Newcastle in October 2021, with several potential sites currently under consideration.

Its latest accounts reveal its turnover jumped to £44.38 million in the year to May 1, 2022, from £11.48m in the prior 12 months. The group, which is owned by Mr Gizzi and Tony Conetta and employs around 900 staff, achieved a rise in pre-tax operating profits before exceptional items from £685,000 to about £8.75m.

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Mr Gizzi said: “It was really humbling to see the huge efforts that our team members put in to get us back up and running again so quickly after lockdown was lifted.That said, there are still major challenges on the horizon, particularly with significant inflationary pressures on wages, utilities, and ingredients, many of which are imported. Like the rest of the sector, we have been hit hard by the upsurge in costs across the board, but we feel we are managing those as well as anyone and are quietly confident about future performance.”

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Mr Conetta revealed the strong performance of the new Café Andaluz in Newcastle meant The DRG was “actively examining” further expansion in England.

He said: “The successful formula that we have developed over many years in Scotland has proved just as popular with diners south of the Border and our Newcastle restaurant has been a very welcome success, despite the hangover from Covid. We’re currently looking at a number of other sites in England and hope to be in a position to make further announcements in the near future.”

A spokesman for The DRG noted the group’s staff numbers were similar to those before the coronavirus pandemic.

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The DRG has three Di Maggio’s sites, six Café Andaluz venues, three Amarone restaurants, and three food-court outlets. Its other restaurants include Cadiz in Edinburgh, and Barolo, Anchorline, Atlantic Brasserie and The Citizen in Glasgow.

Asked whether cost rises were proving manageable or a challenge, and how Mr Gizzi and Mr Conetta viewed the outlook given the squeeze on consumers, the spokesman replied: “The current trading environment is definitely challenging for hospitality, although in general we are trading slightly ahead of budget revenue but offset by increased costs [versus] budget. Utility-cost and labour inflation, combined with limited resource is a real challenge for the sector and increases the focus on good financial and operational management.”